Tax-efficient investing

The Trust Company of Tennessee considers tax efficiency in our portfolios. Investment selection and asset allocation are important factors; minimizing the amount of taxes generated in an account also has a significant effect in allowing you to keep more money.

We believe it makes sense to have a diversified investment strategy to manage risk. It also makes sense to have tax diversification in your investment accounts. It is important to consider where it is appropriate to invest in both taxable and tax-advantaged accounts.

Taxable accounts, such as Investment Management Accounts and brokerage accounts, offer great flexibility, such as being able to withdraw at any time without penalty. Tax-advantaged accounts offer tax benefits such as tax-deferred or tax-free growth.

Depending on your income, tax-efficient options, including municipal bonds and funds with low turnover/low capital gain distributions, may be more appropriate in taxable accounts.

One of the cornerstones of your financial plan, whether you want to save for retirement or generate cash, is to minimize taxes. There are always exceptions, so consult with your Relationship Manager and tax advisor to choose the best tax strategy for your situation and goals for retirement. As always, we’re here to help you navigate your financial decisions to help you live confidently.